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r <br />Utilities Director, Terry Pinto, explained staff <br />recommendation to approve Sea Oaks application for.a <br />ra <br />franchise to treat and sell waste water treatment. He felt <br />that the proposed rate structure would be adequate to <br />maintain their operations and also fair to the people <br />receiving service and assured the Board that the 12% rate of <br />return on equity is within the range allowed by the Public <br />Service Commission. <br />Commissioner Scurlock understood that in the past year <br />or so the approved allowable rate was between 8%-13%. He <br />felt it was a wise approach to come in with an adequate rate <br />structure rather than at a low rate and then have people buy <br />the units, move in, and have the Commission immediately <br />faced with a rate hearing. <br />Commissioner Scurlock further understood that all plans <br />and specifications must be submitted to the Utilities <br />Department for approval prior to obtaining a permit to <br />construct. He thought it was extremely important that the <br />system be built to the proper'standards in case we ever took <br />it over. <br />Mr. Pinto replied that the intention of the staff <br />recommendation is to make it clearly understood that the <br />approval of the franchise is not to be construed as a permit <br />to construct. <br />Commissioner Scurlock questioned how the franchise <br />deals with the use of effluent for irrigation purposes. Mr. <br />Pinto replied that the rate structure provides that effluent <br />used for irrigation purposes would be charged back at 50� <br />per 1000 gallons. He stated that every effort will be made <br />to encourage such irrigation, and noted if it works out, it <br />will reduce dramatically the demand on the potable water <br />supply. <br />Chairman Bird asked if Wabasso Beach Park is included <br />in this franchise area so that sewer service will be <br />23 <br />